Daikin India has formed a joint venture with one of world’s largest AC compressor maker Taiwan’s Rechi to make such products in Sri City, Andhra Pradesh. This is Daikin’s second compressor factory, the first one in Neemrana, Rajasthan is completely owned by the Japanese company. The JV is driven by the government's focus on Make in India and reducing dependence on China especially for critical components. This testing is mandatory. The changing weather pattern and the brutal heat wave in North India this summer sent consumers to the shops scrambling for ACs which were in short supply. “This partnership marks a significant milestone in broadening Daikin India’s offerings, enabling us to deliver a wider array of advanced rotary compressor technologies tailored for residential HVAC solutions,” said KJ Jawa, Chairman and Managing Director of Daikin India. “As the market witnesses growing demand for cost-effective air conditioners, our extensive sales network, customer-centric approach, strong brand reputation, and reliable after-sales support—combined with Rechi Precision’s innovative rotary compressor expertise—will empower us to provide economical and efficient air-conditioning options for our valued customers.” The new factory that will start churning out the compressors by fourth quarter 2024-25 December will also export and sell to other AC manufacturers. Daikin's Indian unit enjoys a strong relationship with the parent company in terms of transfer of technology, technical know-how, supply of key raw materials, etc. In fact, India is strategically important for the world's biggest air-conditioners firm as a key supplier to other geographies. The Indian business had planned a large-sized capex plan of Rs 14 billion, which will include capacity expansion and backward integration as well as an associated R&D centre for FY2025-FY2027. The capex is related to doubling the existing installed capacity and setting up backward integration towards component manufacturing such as compressor, motor, heat exchanger, plastic moulding, etc.“In this joint venture, Rechi Precision will bring technical knowhow, R&D, continuous product development, production engineering capability etc and play a key role in setting up sales and service capability in India for Rotary Compressor Business. We are very excited to partner with Daikin and bring latest technology in the field of Rotary Compressor to India.” said Chen, Shen Tien Chairman of Sampo Corporation, Holding Company of Rechi Precision.Under this JV agreement, a joint venture will be established in India with Daikin India holding a majority share. In the initial phase of the partnership, efforts will concentrate on providing test samples of Rechi Group Taiwan’s rotary compressors (both inverter and non-inverter) to India’s AC manufacturers to facilitate swift adoption and evaluation. Once the manufacturing plant at Sri City becomes fully operational, Daikin India will have production capacity of 2.8 million compressors and 3 million room air-conditioning from 2 million now. Besides, most other components such as heat exchanger, copper tubing, motor, cross flow fan, plastic molding, sheet metal components, printed circuit board, etc., will be available in house.